National divided on tax cuts
By Richard Harman (author)
Former Health Minister Jonathan Coleman announced his retirement from politics yesterday with a another swipe at National’s tax cuts policies.
When he stood for his party’s leadership in 2016, Coleman made it known he opposed the tax cuts policies that were to become a central plank in National's 2017 election campaign.
Though his leadership bid didn’t succeed, it is now clear he kept up his opposition to the cuts through his last year in Cabinet.
That didn’t stop him being blamed by some of his colleagues and members of the National Party for the criticism the Government took last year over its health policies.
But he says he had always wanted a debate about tax cuts.
“I wanted a debate about tax cuts versus social spending,” he told POLITIK.
"There's a range of views within the party, but I'm leaving politics.
"So that is for the party to sort out for the future.
"But I do think as we go into 2020 we need to be in tune with what the public will be demanding.
“Will they want tax cuts as opposed to a shift in the tax bracket because there has been bracket creep.
“Or do they want more investment in health and education.
“And my view has always been that you have got to properly fund health and education first before considering tax cuts.”
Coleman has continued to make these points after he went public during the leadership election.
There are reports of debates around the last Government’s Cabinet table where he and other Ministers challenged Finance Minister Steven Joyce over the cuts.
The new leader, Simon Bridges, has suggested in a number of interviews that he too was sceptical about the cuts.
But yesterday was the first time Coleman had been so specific in public thereby revealing quite a substantial division within the last Government.
His critics – and he has a few within both the Caucus and the party – would argue that he is saying this now to justify his own record as Health Minister where he was frequently attacked for underfunding health.
Last June then-Labour Leader Andrew Little said "the funding needed for health to be restored to the level it was seven years ago to keep pace with cost pressures was $2.3 billion."
During the election campaign, Prime Minister Jacinda Ardern said: “I believe that properly funding health is more important than tax cuts that deliver the most to the top earners.
“It is wrong to be prioritising $20 a week for top earners when there are people in need being turned away from our hospitals.”
Though he clearly agrees with her on tax cuts, Coleman doesn't accept Labour's criticism of the health system under National.
“The issue is how much is enough on health,” he said.
“We realised in my office last year that Labour would attack us on health because they couldn’t attack on the economy becaue of the strength of the economy.
“We had increased funding, but we had increased access to services across the board and very interestingly, since the election all the criticism of the health system has pretty much died away to nothing which proves the point it was very much a political attack.”
Coleman, Auckland Grammar Head Prefect in 1984, a qualified doctor with an MBA, had always seemed like a politician who was bound for his party’s leadership.
But his decision to stand against Bill English for the leadership in 2016 after John Key had endorsed English proved not to be have been a wise move.
He then decided not to stand when English retired and instead unsuccessfully lobbied for Finance.
“When we came out of the election loss and looking to the future, I thought, well, that could be where I would settle into.”
And then he got approached to be CEO of the private health provider, Acurity.
“But as time went on and you process the loss and you look at the alternatives, and the opportunity cost of staying on, it became apparent to me that once this offer was presented that I had to look at it really seriously.
“But it was a difficult decision because I have loved being the member of parliament for the area I live in and that is something I will miss more than Parliament itself.”
His electorate of Northcote has been a swing seat, chopping and changing from Labour to National with the national tides.
But demographic change and his obvious popularity within the electorate has turned it into a relatively safe National seat.
There were two views within the party yesterday as to how it would hold up in a by-election.
Some thought that the overall historic trend of by-elections going against the Government would keep it safe.
Others worried that the “Jacinda effect” could have a big impact in a seat that is beginning to resemble an inner city seat more than the suburban seat it once was.
It is younger (over 50% are aged between 15 and 50); 25% of its population were born overseas, and 24% are Asian. It is relatively affluent; 35% have a household income of over $100,000.
Party officials in Auckland said they were already hearing names of people who might seek the nomination.
The party expects to make a quick selection having learnt the lesson of delaying the selection in a by-election after their defeat in Northland in 2015.
But this by-election is unlikely to be much about the candidates.
At the general election neither the Greens nor NZ First made much of an impact so expect the attention to be focussed on the two main parties.
And the campaign will be the first head to head encounter on the hustings between Jacinda Ardern and Simon Bridges.
That will give it a national focus.